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Sneaker 2013 - Assumptions (From the Case Study) 2012 2013 2014 2015 2016 2017 2018 Sales (# units: pairs) 1,200,000.00 1,600,000.00 1,400,000.00 2,400,000.00 1,800,000.00 900,000.00
| Sneaker 2013 - Assumptions (From the Case Study) | |||||||||||||||
| 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | |||||||||
| Sales (# units: pairs) | 1,200,000.00 | 1,600,000.00 | 1,400,000.00 | 2,400,000.00 | 1,800,000.00 | 900,000.00 | |||||||||
| Price / Pair | $ 115.00 | $ 115.00 | $ 115.00 | $ 115.00 | $ 115.00 | $ 115.00 | |||||||||
| Cannibalization | $ 35,000,000.00 | $ 15,000,000.00 | |||||||||||||
| Var Costs (% of revenue) | 55% | 55% | 55% | 55% | 55% | 55% | |||||||||
| S G & A Expenses | $ 7,000,000.00 | $ 7,000,000.00 | $ 7,000,000.00 | $ 7,000,000.00 | $ 7,000,000.00 | $ 7,000,000.00 | |||||||||
| Endorsement | $ 2,000,000.00 | $ 2,000,000.00 | $ 2,000,000.00 | $ 2,000,000.00 | $ 2,000,000.00 | $ 2,000,000.00 | |||||||||
| Other Ad & Promotion | $ 25,000,000.00 | $ 15,000,000.00 | $ 10,000,000.00 | $ 30,000,000.00 | $ 25,000,000.00 | $ 15,000,000.00 | |||||||||
| A/R (% of net revenue) | 8% | 8% | 8% | 8% | 8% | 0% | |||||||||
| Inventory (% of Var Costs) | 25% | 25% | 25% | 25% | 25% | 0% | |||||||||
| A/P (% of Var Costs) | 20% | 20% | 20% | 20% | 20% | 0% | |||||||||
| Factory Expansion | $ 150,000,000.00 | ||||||||||||||
| Equipment | $ 15,000,000.00 | ||||||||||||||
| Freight and Installation | $ 5,000,000.00 | ||||||||||||||
| Inventory | $ 15,000,000.00 | ||||||||||||||
| A/P | $ 5,000,000.00 | ||||||||||||||
| Tax Rate | 40% | ||||||||||||||
| Factory MV (at the end of Year 6) | $ 102,000,000.00 | After Tax SV of Factory | SV - (SV-BV)*Tc | ||||||||||||
| Equipment MV (at the end of Year 6) | $ 3,000,000.00 | After Tax SV of Equip, Fr, Inst) | SV - (SV-BV)*Tc | ||||||||||||
| Cost of Capital | 11% | ||||||||||||||
| Sneaker 2013 Projected Cash Flow Statements | |||||||||||||||
| 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 39 Yr MACRS Dep % | ||||||||
| New Factory (CAPEX) | Terminal val = After Tax SV of Factory | Yr 1 | Yr 2 | Yr 3 | Yr 4 | Yr 5 | Yr 6 | ||||||||
| Equipment (plus Freight & Installation) | Terminal val = After Tax SV of Equip, Fr, Inst) | 2.60% | 5.00% | 4.70% | 4.50% | 4.30% | 4.00% | ||||||||
| Revenues | 5 Yr MACRS Dep % | ||||||||||||||
| Cannibalization (Erosion) | Yr 1 | Yr 2 | Yr 3 | Yr 4 | Yr 5 | Yr 6 | |||||||||
| Net Revenues (after Erosion) | 20% | 32% | 19.20% | 11.52% | 11.52% | 5.76% | |||||||||
| Variable Costs | |||||||||||||||
| S G & A Expenses | |||||||||||||||
| Endorsement | Y 0 | Yr 1 | Yr 2 | Yr 3 | Yr 4 | Yr 5 | Yr 6 | ||||||||
| Other Ad & Promotion | BV Factory | $ 150,000,000.00 | |||||||||||||
| Factory Dep (39 yr MACRS) | |||||||||||||||
| Equipment (plus Freight & Installation) Dep (5 Y MACRS | Y 0 | Yr 1 | Yr 2 | Yr 3 | Yr 4 | Yr 5 | Yr 6 | ||||||||
| EBIT | BV Equipment, Fr, Inst | $ 20,000,000.00 | |||||||||||||
| Taxes | |||||||||||||||
| Earnings Bef Int After Taxes | Calculation of Change in NWC | ||||||||||||||
| Add back Fac Dep | Y 0 | Yr 1 | Yr 2 | Yr 3 | Yr 4 | Yr 5 | Yr 6 | ||||||||
| Add back Equip, Fr, Instl Dep | A/R | ||||||||||||||
| Operating Cash Flows | Inventory | $ 15,000,000.00 | |||||||||||||
| Change in NWC | A/P | $ 5,000,000.00 | |||||||||||||
| NWC (CA - CL) | $ 10,000,000.00 | ||||||||||||||
| Change in NWC - Cash Impact (Spending) | $ (10,000,000.00) | ||||||||||||||
| New Factory (CAPEX) | |||||||||||||||
| Equipment (plus Freight & Installation) | |||||||||||||||
| Operating Cash Flows | |||||||||||||||
| Change in NWC | |||||||||||||||
| Project NET CASH FLOWS | |||||||||||||||
| Criteria | Use Excel Fn | Decision | |||||||||||||
| NPV |
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Please show the formulas also thanks
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Financial Whirlpools A Systems Story Of The Great Global Recession
Authors: Karen L. Higgins
1st Edition
0124059058,012405921X
